Essay Sample on Lemonade Production: A Profitable Business Idea for Students, Unemployed & Stay-At-Home Parents

Introduction

Waves Cafe will be a new and medium beverage retailer. We decided to establish it based on lemonade production that is an entirely new business idea in the food and beverage industry in Canada. Lemonade production stands as one of the most profitable business ideas that can be implemented by any individual, inclusive of the university students, to earn income during summers and holidays. Besides, it is favorable for the unemployed population or stay-at-home parents. The main operations involved in this idea are processing lemons obtained from various farms and others purchased from the market, extract the lemonade, brand, and later sell it through our Waves Cafe retail outlets. Furthermore, this concept is important since it does not require intensive capital. With at least $200, one can start and operate a lemonade venture. However, if one has adequate capital to invest, it provides opportunities for expansion and offering a variety of lemonade juices to consumers. One can also consider processing other types of fruits other than lemons as well as other beverages such as coffee to boost the business revenue. Despite the benefits and reasons for choosing this idea, it is not excluded from competition from other businesses that offer similar products. For example, some of the main potential competitors in this business in Canada include Fresh Del Monte, PepsiCo, Citrus World, and Ocean Spray. Although they offer different juices flavors, lemonade is among their leading brands in Canada that have given them a competitive edge. There are, nonetheless, some trends that give our business idea a future in the Canadian food and beverage industry. A significant current trend is that clients are dropping high-calorie content beverages and adopting nutrient density drinks such as lemonades. Besides, there is a war on sugar in Canada that has a crucial influence on the buying decisions of consumers. Consumers are also turning towards natural beverages, for example, lemonade, over artificial drinks to improve their health. Therefore, our lemonade venture is assured of a significant market share to allow it to continue operating and earning income.

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Overview and Description of the Industry

Lemonade's business venture is categorized in the food and beverage industry in Canada. Besides, this industry is experiencing a speedy revolution initiated by current innovation and trends. The demand for healthy packed foods and beverages is a major trend in this industry, which is set to remain for long. Thus, ventures that may rejuvenate themselves with the rapidly transforming trends may be prosperous in the industry and be ranked as the client's top preference. Nevertheless, similar to other industries, it is also prone to various critical risks, which are becoming crucial and increasing market competition. Advance in technology with the food and beverage industry has furthermore emerged as a threat in terms of cost constrain and adoption. The Canadian food and beverage industry have experienced a significant increase in income. For example, in 2017, the market size was valued at $85 billion. In 2019, there was a significant increase to approximately $1 billion (Wernerson, 2018). According to a report presented by Niebylski et al. (2015), in 2015, the Canadian market for beverages was valued at approximately 28.0%, but in 2019, it increased to 36.0% of the global market income. The market price is, however, expected to grow by up to $781 billion in 2020 (Wernerson, 2018). Besides, an increase in consumer disposable revenue taken an instrumental position in boosting the sale of beverages. On the flip phase, prevalent health complications, for instance, obesity, diabetes, and cardiovascular ailments, are inhibiting the food and beverage industry in realizing its optimal potential.

Integrated Model of a Successful Business

There are some of the most crucial activities that we should do to ensure that our lemonade production idea is successful. Most of them are, however, complimentary of each other while others are independent. They include:

Formulate a Strong Message

The message should describe what client problem lemonade venture is addressing that potential customers are willing and able to compensate for. Besides, this is commonly known as the value proposition. It convinces customers to purchase from the business and become recurrent clients.

Concentrate on the Clients and Fully Comprehend the Market

Some companies do not have the best commodities or take the initiative to market their goods and services, but they are prosperous since they have invested in online sales and marketing. Thus, for this venture to be successful, it is vital to conduct research, particularly on the demographics of the potential client base and comprehend their purchasing behavior. Besides, this is possible through browsing the competitors mentioned above' websites, observing similar small enterprises, and observing what clients say about them through social media such as Facebook and Twitter.

Begin Small and Expand

The best approach to begin with our lemonade idea is to start small. It would involve self-funding the business and later find an additional funding source after creating a growth story. Although this technique may influence us to break our lemonade offering into smaller, affordable quantities, this will be essential in funding the business in its early phases while getting experience and purchases.

Comprehending Individual Competencies, Strengths, and Available Time

Before operating this venture, it is significant to comprehend individual skills, such as accounting and marketing. Besides, these skills will be essential in keeping track of business cash flow and advertising lemonade products to potential customers. Also, understanding the individual time available is important to assess the amount of time one has to handle business operations. Where individual time may be limited, it would be essential to hire employees to help in processing and to market the lemonades.

Have a Close Contact with Mentors and Advisors

Starting and expanding a business is challenging, and approximately 50% of entrepreneurs have failed in their first five years. Furthermore, no individual may have extensive experience, knowledge, or perspective to operate every venture. Thus, it is essential to attain experiences and skills from mentors and advisors who have conducted successful business in the past or have knowledge in running various types of ventures.

Formulate a Business Plan

Starting a business such as lemonade production may be risky and challenging. Therefore, before beginning any activity, it is significant to determine the form of business we need to create that is, will it be a partnership or sole proprietorship. This will be the start of formulating the business plan and significant in helping us place lemonade business ideas to tangible.

Have Performance Metrics in Place

It will be important to have some performance indicators that will aid in determining whether the business is operating as projected. They will also be essential in making decisions. They will also help identify the sectors that will require more resources to improve their respective performance hence achieving the overall success of the business.

Assess your Competition

Competition in business sometimes brings the best outcomes, particularly for customers (Teece, 2010). To have a successful business, an entrepreneur cannot afford not to learn and study his competitors. Besides, they may be performing something right that, if implemented in the current business idea, may it more successful than theirs.

Comprehend the Absence of Entitlements

To achieve a successive business, it is mandatory to work hard to achieve all the goals since being a small business owner is among some of the challenging professional globally. According to a survey conducted by Teece (2010), 40% of the small enterprises' owners were reported to take vacations and, at the same time, had their capital held in the business. This means that 60% remain in their businesses in an attempt to achieve their business goals.

Have a Passion in the Business Idea

Besides, being a small business owner, it can sometimes be lonely with inadequate hours of achieving the desired plans. Thus, if not stirred by passion at every phase of this idea, implementing it may ultimately become challenging. Therefore, being a business founder, it is vital to allow passion motivation you continuously.

PESTI Analysis

Political Analysis

The political environment greatly influences a business's operations and marketing decisions. They include factors such as rules and policies, for instance, fiscal policies and trade traffic, among other factors such as pressure groups and government agencies that affect the Canadian economy and, in turn, the activities of any business.

For example, through regulations and policies, the Canadian government, just like other government, is involved in various business operations and functions. The businesses, in turn, have to make sure that in every decision they make, they follow the rules and regulations put in place. Besides, while they are creating different policies such as those related to the environment, fiscal, monitory, and recruitments, they should be following the Canadian political factors. Our business idea is a non-alcoholic beverage enterprise falls within the Canadian Food Inspection Agency. It is described as a government recognized agent that is mandated to assess and validate the ingredients utilized in beverages. Therefore, our business has to make sure that the ingredients used in preparing lemonades always meet the Canadian FIA guidelines before getting their approval.

Despite adhering to the Canadian Food Inspection Agency requirements, another significant political factor that may affect the operations of our business include political crisis (Morin, Pauwelyn & Hollway, 2017). For example, political violence and instabilities may introduce fluctuations in lemonade's demand. Such a phenomenon may make it challenging for our business to penetrate in different geographical locations in Canada. They, in turn, result in low sales and ultimately to lower profit margins.

Economic Analysis

Canada is ranked as the 10th largest economy in the globe, with a growth rate of 1.87% (BI INDIA BUREAU, 2020). Its economic system is well composed and obtains its strength from the manufacturing and service industries. It is a state where big companies who are our competitors such as Coca Cola have grown, shaped themselves, and led the economic deliberations on the globe. In the 2009 recession, however, it was badly impacted, and most organizations collapsed as well as the rates of employment escalated to an alarming degree. But things become favorable in recent years and of interest, the level of income increased, and the rate of unemployment fell towards the end of 2015 (BI INDIA BUREAU, 2020).

It is worth stating that there is a high amount of disposable income in Canada. Its population is currently getting wealthier as an overall trend (BI INDIA BUREAU, 2020). This denotes that people in the upper, middle, and lower classes all have money to spend on secondary and luxury commodities such as restaurant food and beverages. As such, the general income in the food and beverage industry is increasing as people eat and drink from them more often. Besides, this has a positive impact on every concern of spaces with the exclusion of food distributors, restaurants, and drink outlets, among others who play a crucial part in this industry.

However, it essential to note that labor is not cheap in Canada, mainly when compared to Mexico, India, and China (Balsvik, Jensen &...